San Luis Obispo County’s cities are voicing support to keep the lights on at Diablo Canyon Power Plant for another 20 years, but that backing comes with calls to restore unitary tax at pre-decommissioning levels.
By Jan. 13, the Arroyo Grande and Grover Beach city councils decided to join the county in a request to the California State Legislature to extend Diablo Canyon’s operations.
Paso Robles City Council was scheduled to discuss joining the coalition on Jan. 14 after New Times went to press.
State Senate Bill 846, the California Public Utilities Commission, and the California Coastal Commission are allowing Diablo Canyon owner Pacific Gas & Electric Company to keep the plant open until 2030.
But the utility company is awaiting the federal Nuclear Regulatory Commission’s approval of a relicensing permit that could keep the nuclear power plant open until 2050.
The cities became involved after the SLO County Board of Supervisors sent a letter to the Legislature on Dec. 16 requesting it support the Nuclear Regulatory Commission’s approval process.
Supervisors also requested that the Legislature establish “a state licensing pathway”—a bill like SB 846—to authorize the plant to run for two more decades.
“Continuation of operations, however, must be accompanied by fiscal fairness for the communities that host and support the facility,” the supervisors’ letter said. “Historically, unitary tax revenues have been distributed to the county, cities, school districts, and special districts, supporting essential public services, educational programs, infrastructure maintenance, and public safety. Restoration of this tax structure is critical to maintaining the fiscal stability of local governments and public agencies.”
In 2016, PG&E agreed to an $85 million settlement to cushion the impact of Diablo Canyon’s originally scheduled closure in 2025. SLO County is now receiving less revenue over time despite Diablo Canyon being permitted to stay open for five more years.
The county didn’t respond to New Times’ requests for comment by press time.
SB 846 stalled unitary tax payments to local jurisdictions. The legislation included provisions that exempted new investments and operating costs associated with extending Diablo Canyon’s life from unitary taxation.
So, local jursidictions could continue seeing reduced tax revenues unless legislative measures are enacted.
Countywide, the unitary tax fell from $21 million annually to $8 million.
For Arroyo Grande, unitary tax dipped from $83,300 in fiscal year 2021-22 to $55,200 in fiscal year 2025-26.
Pre-decommissioning unitary tax stood at more than $50,000 for Grover Beach, dropping to $34,000 in fiscal year 2024-25.
Unitary tax revenue from Diablo Canyon once brought in $10 million a year for San Luis Coastal, which recently entered its second year of budget cuts.
However, Arroyo Grande and Grover Beach city managers told New Times that the cities accommodated the reductions without losing any local programs and projects.
“Given this relatively small reduction in revenues over a multi-year period, we have not had to cut any programs or projects as we have been able to account for this change in our budget,” Grover Beach City Manager Matt Bronson said. “Other agencies that receive a greater share of unitary tax revenues, like the county and San Luis Coastal School District, likely face more significant impacts.” ∆
This article appears in Jan 15-22, 2026.
I sort of doubt that they can just reimpose the Unitary Tax. The county agreed to a $85 million settlement, which settled their obligation, but having spent the money, now wants more. I don’t think that they can just remake the deal now.
I think it’s a easy as the CA State Board of Equalization reassessing the value of Diablo Canyon for unitary tax purposes based on either operating through 2030, 2050, or the most likely scenario of operating indefinitely.